RETAIL PARTNERS CO., LTD.

Business Details

A supermarket business selling processed foods, prepared foods, daily necessities, and other items centered on fresh food. Six operating companies—Maruku Co., Ltd. (Yamaguchi, Hiroshima, Shimane, Fukuoka), Marukyo Co., Ltd. (Fukuoka, Nagasaki, Saga, Oita, Kumamoto), Marumiya Store Co., Ltd. (Oita, Miyazaki, Kumamoto, Fukuoka, Kagoshima), and Hattsutori Co., Ltd., Tomura Seiniku Honten Co., Ltd., and Nagano Co., Ltd. (Miyazaki)—each hold high market share and brand recognition as local supermarkets in their respective regions, differentiating themselves through community-focused merchandise assortments and freshness. Total store count at the end of the first quarter of FY2027 (ending March 2027... wait, ending February 2027) stood at 280 stores (down 1 store from the end of the prior fiscal year).

Recent Overview

Revenue increased, but operating profit fell sharply by 24.2% year-on-year due to higher labor costs and procurement costs

In the first quarter of FY2027 (ending March 2027) (March to May 2026), the Supermarket Business secured revenue growth, with operating revenue of ¥70,725 million (up 3.1% year-on-year), driven by the consolidation effect of Nagano Co., Ltd. (8 stores in Miyazaki Prefecture) and higher per-item prices due to inflation. On the other hand, continued increases in procurement costs from rising merchandise and raw material prices, along with higher labor costs and various fees, led to a sharp decline in operating profit to ¥1,470 million (down 24.2% year-on-year). The store count decreased to 280 stores following the closure of the Alc Yahatanishi store in Fukuoka Prefecture. In addition, due to a change in inventory management systems, certain subsidiaries changed their inventory valuation method from the gross average method to the retail inventory method (impact is minor).

Key Products

Growth Drivers

• Additional sales contribution from the continued consolidation of Nagano Co., Ltd. (8 stores in Miyazaki Prefecture)
• Increase in per-item customer spending due to the continuing trend of price increases in food and beverages
• Strengthened digital customer engagement through the renewal of the Maruku App (addition of smartphone payment function)
• Improved gross margin through value enhancement of proprietary products, including the launch of the second private brand product, "Strong Carbonated Water Lemon"
• Cost reduction through joint procurement and private brand development via the New Japan Supermarket Alliance (Arcs, Valor Holdings)
• Labor-saving and efficiency improvements in operations and productivity gains through DX promotion
• Improved logistics efficiency in southern Kyushu through utilization of the RPG Miyazaki Distribution Center

Risks

• Rising cost of sales ratio due to increased procurement costs (surging prices of merchandise and raw materials)
• Structural increase in labor costs due to wage increases (employee salaries and bonuses in the current first quarter were ¥7,284 million, up 8.7% year-on-year)
• Rising store operating costs such as payment processing fees and electricity charges
• Intensifying competition across industries and business formats (e-commerce, drugstores, etc.)
• Shrinking market in trading areas due to declining birthrate, aging population, and population decline
• Downward pressure on customer traffic and average spending per customer due to continued consumer thrift and selective spending
• Risk of increased procurement costs due to rising crude oil prices and exchange rate fluctuations stemming from factors such as the Middle East situation
• Risk of widening gap versus the final-year target of the Third Medium-Term Management Plan (Q1 progress rate of 20.7% against the full-year operating profit forecast of ¥6,800 million)
• Impairment loss risk (due to store closures or suspensions)